The future of scaling Web3 has come into clearer focus in the back half of 2023. Let’s examine 5 levels of interlocking technologies that will allow billions of current Web2 users to upgrade seamlessly to Web3.

1. Ethereum ERC Ecosystem

2. Scalable Block Space with ZK-Rollups

3. Scalable Account Abstraction

4. Scalable Blockchain Syncing

5. Dapps

The fundamental pillar undergirding the entire stack is the ERC ecosystem. Academia peer reviewing standards meets battle tested money machines with billions of fiat equivalent dollars on the line 24/7/365.

While there are thousands of Ethereum standards - two come to mind with outsized influence to scale the entire stack:

• ERC2535: A modular class based system for structuring smart contracts of limitless size and complexity.

• ERC4337: The crown jewel of the Ethereum ecosystem. A formalized method to abstract account control away from a raw private key, and into a smart contract. This allows for the secure manipulation of user funds writ any onchain interaction programmatically.

Ethereum cannot, nor should not get bloated with data. Like Bitcoin, blockspace on the mainnet of mainnets is sacred.

• To scale effectively, the source chain need only store hashes of transactions from EVM-compatible ledgers higher on the stack.

• To scale sustainably, the source chain must also be long-term revenue positive. Only Ethereum sells profitable blockspace. Even king Bitcoin demands a block reward to make securing the chain possible.

Thus we have our winning stack. Secure and profitable L1 ETH blockspace, with L2 chains to scale the system.

As an example, to scale a web3 video game you could..

1. Make 100,000 discrete onchain gaming transactions on ImmutableX

2. Then compress said transactions to <10 hashes on Ethereum mainnet with ZK-Rollups

Users get both benefits of nearly free and instantaneous receipts + the security of a proof hash on a truly immutable L1 blockchain. This combined stack is at the vanguard of both privacy and scaling.

• Bitcoin has a related scaling technology called lightning.. Alas, lightning cannot perform more complex turning complete computations needed to power smart accounts.

• Solana relies on bribing unprofitable supercomputer nodes with 42x more supply creation than fee revenue. Aka the ultimate cashflow negative startup running on borrowed equity goodwill.

Thus, forward-thinking blockchains that started on different L1 stacks are racing to integrate ZK-EVM as we speak. This gives them the benefit of abstracted account interoperability, with the advantages of privacy and scaling. (more on this later)

However, not all ZK-EVMs are created equally. Most are pure copy-pastes. Some are bespoke in a good way, some less. The nuances of block times, security, block explorer quality, RPC quality, and countless other differences between implementations go beyond the scope of this article but do matter. Top ZK-EVMs that come to mind with different core operating principles include:

• Optimism stack (The most well adopted ZK-EVM stack good enough the Coinbase Base L2 despite the poor UX of 7 day lock times)

• Telos (An EOS-based enterprised focused layer 0 with a dedicated ZK-EVM development team headed by an ex Ethereum Foundation core developer)

• Astar (An APAC centric Polkadot-based omni chain with a Polygon partnership to use their near instant finality ZK-EVM CDK)

The future of onboarding billions of Web2 users into Web3 relies on the ability to make users wallet accounts instantly with a familiar login method. The technology required to do this at scale (ERC4337) was only released in Q1 of 2023.

For the first time in the 15+ year history of the blockchain, users can now seamlessly delegate their private key passwords to a smart account. This means with a single click, a user can seamlessly upgrade to Web3 using their familiar Web2 login.

Who to trust to implement ERC4337 correctly? To handle the raw keys. Bitcoin old timers know the adage “no keys no crypto”. Hopefully then the key holders we trust with the power of ERC4337 know what they’re doing.

There are two primary flavors of key management:

• Regular private venture backed corporations: Web3Auth, Fireblocks, et al that (hopefully) use best practices to make stealing keys mathematically impossible. Assurances that insiders cannot corrupt the system feels right. Also ensuring data rights around the ability for users to export to other providers.

• Academic outfits with venture flavor: LIT Protocol is thinking about how to shard private keys into dozens of federated nodes that all need to agree to get anything done. Adding complexity adds failure points but knock yourselves out.

MPC (multi-party computation) is now a solved problem, and the current internet securely manages billions of keys through the likes of Okta et al. There is no reason services like Web3Auth cannot scale to manage billions of web3 user keys.

The balance of power is in the configuration. If you make a smart account for a user, then stop paying your Web3Auth bills, or your dapp goes out of business, your users will have their funds trapped inside the Smart Account with no way to access them.

Who is going to store and relay block information? Moreover, if the blockchain becomes too big, then who can still sync it?

Fortunately our Bitcoin forefathers were smart enough to limit chain growth to 1 megabyte every 10 minutes. While Ethereum is slightly more bloated with chain size, math wizards are working on EIP4844 proto-dank sharding bring more L2 scaling functionality back to the source chain in a space efficient manner.

Time will tell if Bitcoin boomer rocks, or Ethereum wizardry prevails. Either solution needs to ensure small operators can always run a full node to keep the system honest (unlike Solana).

To sync the blockchain at scale in a practical low cost manner, developers will choose larg scale centralized for profit corporations every time. It makes both business alignment, and economic sense. Two solutions come to mind when choosing a syncing partner.

• Alchemy: The slick well funded new comer with all the right pedigrees, and a 10 billion dollar 2021 era valuation.

• Google: The 1.7 trillion pound gorilla that will run a decided Ethereum full node on GCP for $500/month - with unlimited read/write no less.

Either solution will handle the critical (yet ultimately commodity-like) task of keeping your dapp synced with the blockchain.

Finally the fun part! Letting loose the noose Web2 monolithes exert around all of our collective necks (As long as you continue to pay your cloud bills)

Only when the previous 4 levels of stack are sufficiently solved, can the next Web3 - Uber, Netflix, Onlyfans, eTrade, JP Morgan Chase emerge.

All dApps will offer social login. Hopefully, most will continue to support Metamask and offer incentives for users to go pro and self-custody.

The flow for onboarding new users into Web3 will look as follows:

1. Social Login with Google, Twitter, Facebook et al.

2. Behind the scenes Alchemy API calls Web3Auth to create a new 0x address. Users will then have the power into interact with an onchain smart contract containing their valuables via social login authorization.

3. Pick a well made ZK-EVM. They are not all the same. Different block times, different base consensus, different skill sets between development teams. Telos and Astar both come to mind.

4. User clicks buy and Google or Apple Pay seamlessly fill their Astar ZK-EVM 0x address behind the scenes. Liquidity is sourced from CEXs like Coinbase and Binance, maybe even from the next generation of DEX like THORchain. This step is the most fraught with peril, as this is where Operation Choke Point and hulking remains of the fiat system live.

5. User purchases their metaverse pass, or art piece, (or transfers the title to their new Web3-Zillow home) or whatever myriad other valuable service dApps can provide better, faster, cheaper, and more data secure than web2 apps.

--

Thank you for reading, if you’d like to learn more about this stack, or get help with your enterprise implementation please reach out to us at https://rair.info

The future of scaling Web3 has come into clearer focus in the back half of 2023. Let’s examine 5 levels of interlocking technologies that will allow billions of current Web2 users to upgrade seamlessly to Web3.

1. Ethereum ERC Ecosystem

2. Scalable Block Space with ZK-Rollups

3. Scalable Account Abstraction

4. Scalable Blockchain Syncing

5. Dapps

The fundamental pillar undergirding the entire stack is the ERC ecosystem. Academia peer reviewing standards meets battle tested money machines with billions of fiat equivalent dollars on the line 24/7/365.

While there are thousands of Ethereum standards - two come to mind with outsized influence to scale the entire stack:

• ERC2535: A modular class based system for structuring smart contracts of limitless size and complexity.

• ERC4337: The crown jewel of the Ethereum ecosystem. A formalized method to abstract account control away from a raw private key, and into a smart contract. This allows for the secure manipulation of user funds writ any onchain interaction programmatically.

Ethereum cannot, nor should not get bloated with data. Like Bitcoin, blockspace on the mainnet of mainnets is sacred.

• To scale effectively, the source chain need only store hashes of transactions from EVM-compatible ledgers higher on the stack.

• To scale sustainably, the source chain must also be long-term revenue positive. Only Ethereum sells profitable blockspace. Even king Bitcoin demands a block reward to make securing the chain possible.

Thus we have our winning stack. Secure and profitable L1 ETH blockspace, with L2 chains to scale the system.

As an example, to scale a web3 video game you could..

1. Make 100,000 discrete onchain gaming transactions on ImmutableX

2. Then compress said transactions to <10 hashes on Ethereum mainnet with ZK-Rollups

Users get both benefits of nearly free and instantaneous receipts + the security of a proof hash on a truly immutable L1 blockchain. This combined stack is at the vanguard of both privacy and scaling.

• Bitcoin has a related scaling technology called lightning.. Alas, lightning cannot perform more complex turning complete computations needed to power smart accounts.

• Solana relies on bribing unprofitable supercomputer nodes with 42x more supply creation than fee revenue. Aka the ultimate cashflow negative startup running on borrowed equity goodwill.

Thus, forward-thinking blockchains that started on different L1 stacks are racing to integrate ZK-EVM as we speak. This gives them the benefit of abstracted account interoperability, with the advantages of privacy and scaling. (more on this later)

However, not all ZK-EVMs are created equally. Most are pure copy-pastes. Some are bespoke in a good way, some less. The nuances of block times, security, block explorer quality, RPC quality, and countless other differences between implementations go beyond the scope of this article but do matter. Top ZK-EVMs that come to mind with different core operating principles include:

• Optimism stack (The most well adopted ZK-EVM stack good enough the Coinbase Base L2 despite the poor UX of 7 day lock times)

• Telos (An EOS-based enterprised focused layer 0 with a dedicated ZK-EVM development team headed by an ex Ethereum Foundation core developer)

• Astar (An APAC centric Polkadot-based omni chain with a Polygon partnership to use their near instant finality ZK-EVM CDK)

The future of onboarding billions of Web2 users into Web3 relies on the ability to make users wallet accounts instantly with a familiar login method. The technology required to do this at scale (ERC4337) was only released in Q1 of 2023.

For the first time in the 15+ year history of the blockchain, users can now seamlessly delegate their private key passwords to a smart account. This means with a single click, a user can seamlessly upgrade to Web3 using their familiar Web2 login.

Who to trust to implement ERC4337 correctly? To handle the raw keys. Bitcoin old timers know the adage “no keys no crypto”. Hopefully then the key holders we trust with the power of ERC4337 know what they’re doing.

There are two primary flavors of key management:

• Regular private venture backed corporations: Web3Auth, Fireblocks, et al that (hopefully) use best practices to make stealing keys mathematically impossible. Assurances that insiders cannot corrupt the system feels right. Also ensuring data rights around the ability for users to export to other providers.

• Academic outfits with venture flavor: LIT Protocol is thinking about how to shard private keys into dozens of federated nodes that all need to agree to get anything done. Adding complexity adds failure points but knock yourselves out.

MPC (multi-party computation) is now a solved problem, and the current internet securely manages billions of keys through the likes of Okta et al. There is no reason services like Web3Auth cannot scale to manage billions of web3 user keys.

The balance of power is in the configuration. If you make a smart account for a user, then stop paying your Web3Auth bills, or your dapp goes out of business, your users will have their funds trapped inside the Smart Account with no way to access them.

Who is going to store and relay block information? Moreover, if the blockchain becomes too big, then who can still sync it?

Fortunately our Bitcoin forefathers were smart enough to limit chain growth to 1 megabyte every 10 minutes. While Ethereum is slightly more bloated with chain size, math wizards are working on EIP4844 proto-dank sharding bring more L2 scaling functionality back to the source chain in a space efficient manner.

Time will tell if Bitcoin boomer rocks, or Ethereum wizardry prevails. Either solution needs to ensure small operators can always run a full node to keep the system honest (unlike Solana).

To sync the blockchain at scale in a practical low cost manner, developers will choose larg scale centralized for profit corporations every time. It makes both business alignment, and economic sense. Two solutions come to mind when choosing a syncing partner.

• Alchemy: The slick well funded new comer with all the right pedigrees, and a 10 billion dollar 2021 era valuation.

• Google: The 1.7 trillion pound gorilla that will run a decided Ethereum full node on GCP for $500/month - with unlimited read/write no less.

Either solution will handle the critical (yet ultimately commodity-like) task of keeping your dapp synced with the blockchain.

Finally the fun part! Letting loose the noose Web2 monolithes exert around all of our collective necks (As long as you continue to pay your cloud bills)

Only when the previous 4 levels of stack are sufficiently solved, can the next Web3 - Uber, Netflix, Onlyfans, eTrade, JP Morgan Chase emerge.

All dApps will offer social login. Hopefully, most will continue to support Metamask and offer incentives for users to go pro and self-custody.

The flow for onboarding new users into Web3 will look as follows:

1. Social Login with Google, Twitter, Facebook et al.

2. Behind the scenes Alchemy API calls Web3Auth to create a new 0x address. Users will then have the power into interact with an onchain smart contract containing their valuables via social login authorization.

3. Pick a well made ZK-EVM. They are not all the same. Different block times, different base consensus, different skill sets between development teams. Telos and Astar both come to mind.

4. User clicks buy and Google or Apple Pay seamlessly fill their Astar ZK-EVM 0x address behind the scenes. Liquidity is sourced from CEXs like Coinbase and Binance, maybe even from the next generation of DEX like THORchain. This step is the most fraught with peril, as this is where Operation Choke Point and hulking remains of the fiat system live.

5. User purchases their metaverse pass, or art piece, (or transfers the title to their new Web3-Zillow home) or whatever myriad other valuable service dApps can provide better, faster, cheaper, and more data secure than web2 apps.

--

Thank you for reading, if you’d like to learn more about this stack, or get help with your enterprise implementation please reach out to us at https://rair.info